Hungarian Prime Minister Viktor Orbán was delighted to learn last week that Russia and the United States had chosen his country as the venue for a new summit aimed at ending the war in Ukraine.
Having positioned Hungary – a member of the European Union and NATO – as an ally of both Vladimir Putin and Donald Trump, Orbán hoped to show the world that “the path to peace runs through Budapest”.
But his hopes were dashed after the Trump administration abruptly abandoned plans for the Budapest summit and unveiled sanctions on Wednesday against Russia’s two biggest oil producers – the first since Trump returned to the White House.
Although the sanctions aim to deplete Russia’s war chest, they could also have disastrous consequences for the Hungarian economy. While almost all EU countries have diversified their energy mix away from Russia since Moscow launched its full-scale invasion of Ukraine in 2022, Hungary’s dependence has deepened. Like Slovakia, its illiberal Central European neighbor, Hungary is almost entirely dependent on Russia for its oil imports.
Orbán must now face the disastrous consequences of his own energy policy. Alongside Washington’s oil sanctions, the EU confirmed on Thursday that it would ban Russian imports of liquefied natural gas (LNG) from 2027. Last month, Orbán told Trump that without Russian energy imports, Hungary’s economy would be brought “to its knees.”
Against what he denounces as Brussels’ bland uniformity, Orbán says he defends “sovereignty” – Hungary’s right to chart its own course within the EU and build ties with radical leaders abroad. But Orbán’s quest for sovereignty – rejecting EU efforts to diversify its energy supplies – has left his country dangerously dependent on a single country for its fossil fuels.
The double blow of U.S. oil sanctions and the LNG ban comes as Orbán, Europe’s longest-serving prime minister, struggles to contain Hungary’s opposition movement led by Peter Magyar, a former Orbán loyalist who has become his main rival. While Orbán had hoped that a Trump-Putin summit could boost his support at home, he now faces a deepening economic crisis that could weaken his position ahead of crucial spring elections.
After Moscow’s all-out invasion of Ukraine in February 2022, EU countries decided to significantly reduce Russian energy imports in order to cut off a major source of Kremlin revenue. However, Brussels granted Hungary, Slovakia and the Czech Republic an exemption from the ban on Russian crude oil, giving them time to reduce their dependence on Russia.
Instead, Hungary and Slovakia used this exemption to increase their dependence. Hungary has increased its dependence on Russian crude oil from 61% before the invasion to 86% in 2024. So far this year, 92% of Hungary’s crude oil imports have come from Russia. Slovakia, meanwhile, depends “almost 100%” on supplies from Moscow, according to a report by the Center for the Study of Democracy (CSD) and the Center for Research on Energy and Clean Air (CREA).
By May, crude oil purchases from Hungary and Slovakia had earned the Kremlin 5.4 billion euros ($6.3 billion), the report said, saying this was “equivalent to the cost of purchasing 1,800 Iskander-M missiles that were used to destroy Ukrainian infrastructure and kill Ukrainian civilians.”
Crude oil imports pass through the Druzhba pipeline, which has been attacked repeatedly this summer by Ukrainian drones, in kyiv’s bid to punish its neighbors for helping finance Moscow’s war.
The CSD-CREA report indicates that Hungary could diversify its energy supplies, receiving non-Russian oil via the Croatian Adria pipeline rather than via Druzhba.
But Orbán has shown no signs of changing course. In an interview with Hungarian state radio on Friday, he said his government was “working on ways to circumvent” U.S. sanctions, without providing further details.
Hungary’s intention to find solutions to U.S. sanctions could be the first major test of the Trump administration’s seriousness in implementing it, said Elina Ribakova, a senior fellow at the Peterson Institute for International Economics, a Washington, D.C.-based think tank.
Despite tough rhetoric toward Russia from U.S. Treasury Secretary Scott Bessent, who said the decision to impose new sanctions on Russia was due to Putin’s “refusal to end this senseless war” in Ukraine, Trump was less aggressive, saying he hoped the sanctions “wouldn’t last long.” The US president also left the door open to the Budapest summit, saying “we will do it in the future.”
The success of sanctions against Russia’s major oil companies will depend on how they are applied, including against a Trump ally like Orbán, Ribakova told CNN.
“What will it be: a friendly Putin-Trump meeting in Hungary, or the sidelining of the Hungarian administration if it tries to evade sanctions?” she said. “I have no idea which way the cards are going to fall here.”
